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Learn about deregulated natural gas and electricity markets in the U.S. Understand your electric rate and learn from others who have had success shopping and choosing an alternate natural gas and electricity company.

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I am interested in your 7.79/kWH guranteed for one year, no contract, no cancellation fee. I just want to know if everything I have with BGE stays the same. The only thing that changes is the amount of the bill. Correct?

Joan, in a deregulated market it is extremely easy to be confused before signing up, after signing up, and all throughout the billing cycle. The reason the confusion becomes so bad is that prior to being deregulated everything was under one company. After deregulation the retail side of the business is split away from the power generation side as well as the pole and wires side of the company. The question usually remains with most people as to what exactly the retail side is if it has nothing to do with power generation or pole and wires maintenance?

This is a good question and basically to answer it I must say that in large part the retail side is simply about betting on the futures market in financial paper transactions regarding what power prices are expected to do, then hedging the commodities energy investments that were bought and profiting on the spread between the price the energy was bought at and the hedge that was bought to protect the investment in case prices drop. On top of this the provider must market and execute the energy correctly in the market so the energy bought is turned around and sold. They must pass through from the old monopoly electric utility the pole and wire charges and these may come in a separate bill. This extra bill is what confuses most people. If you switch companies why do you now get two bills? It almost seems like you are paying extra for going with a new company.

In reality if the new electric company promised you savings it should be a promise based on the cumulative total of the pole and wire charges plus the retail electric provider charges. You simply compare the old cumulative bill total averaged into a per kilowatt hour rate based on your usage with the new cumulative total averaged into a per kilowatt hour rate.

The new rate should be quoted to you and compared with your old rate before you agree to anything otherwise things will get real confusing when you get two bills in the mail and cannot even figure out if you are saving money or not.

Everything with BGE which is your pole and wires company should stay the same, you would simply be switching to a different retail electric company.

In theory if you were told your bill would be less money than what you are paying now then that should be the case. I would do a bill audit on your first months bill to make sure. Feel free to send us your old electric bill and new electric bill and we would be happy to audit your first months bill.